Which of the Following Is True of a Letter of Credit

Multiple Choice

Which of the following is true of a letter of credit in international trade?

A) No cash deposit or collateral is required from the importer.
B) The exporter pays the trusted third party (usually a bank) a fee for the service.
C) It becomes a financial contract between the trusted third party (usually a bank) and the exporter.
D) It is issued by the exporter at the request of the importer.
E) The creditworthiness of the importer is irrelevant when issuing a letter of credit.